Spacetech (2023)

The hitchhiker's guide to making money in the galaxy

Last updated: 28 Sep 2023

Market 101

Spacetech is already more prevalent in our lives than you might think: finding a restaurant on Google Maps and taking a tipsy drive home in an Uber are activities that rely on location pinpointing from satellites. Again, it’s satellites that give us advance warning for hurricanes and heatwaves; allow pilots to communicate with air traffic control; and provide live images of troop movements along with communication services that help the Ukrainian government defend its country. Someday, space may be the place where we make new drugs and materials; maybe even food, wine and organs. Disruptive technologies — specifically reusable launch vehicles and low-cost satellites — have brought down the cost of space, allowing European startups to thrive in several niches, such as capturing data so we can track and understand how the climate is changing. It’s this data, later turned into predictive analytics, that’s the most obvious way of making “new space” money.

In other respects, Europe’s space forays are critically lacking. The continent has no launchers: if a European wants to send something to space, they’ll probably book a ride on one of Elon Musk’s SpaceX rockets. The continent’s trailing in other segments too, like establishing mega satellite constellations to provide internet (Musk’s Starlink is the biggest of its kind by far). The cost and consequences of such dependencies are being sharply felt now, as a result of unstable relations with former space partner Russia, and the speedy progress of the US, China and India.

Exploring space is still technically challenging and extremely capital intensive. Global investment has plummeted back down to Earth this year: it was more than 40% lower in H1 than in the same six months last year, according to VC firm Space Capital. In space, no one can hear you scream about rising interest rates.

And yet, the bullish remain undeterred, their eyes fixed on several commercial opportunities yet to bear fruit. German startups Isar Aerospace and The Exploration Company are building rockets they hope will propel Europe into the SpaceX leagues. Other companies are targeting “in-orbit services” like satellite inspection and repair — of the kind offered by Toulouse-based Infinite Orbits — as well as refuelling options in space, which UK-based Metalysis is working on.

“The next industrial revolution isn’t on Earth,” declares Welsh startup Space Forge, the company aiming to manufacture semiconductors, alloys and composites on mini-factories in space. Another enticing idea is to tap space for renewable energy, by placing solar panels up there for an unrestricted view of the sun. Space Solar, a UK company hoping to bring the concept to life, estimates that a solar panel in space would harvest over 13x more energy. Even if some tech investments are in the gutter, there are still startups looking to the stars.

Early stage market map

Key facts

10k

estimated no. of private space companies globally1

$74m

cost of India’s recent moon landing2

2

Europe-led missions to the moon planned pre-2030 (out of 100 missions)3

Startups tracked by Sifted

Sifted take

What we’re witnessing right now is a period of consolidation and retrenchment, as weaker players drop out or are acquired by rivals. There are up to 10 companies in Europe working on launch capabilities, for example. It’s unlikely there’ll be room for all of them: the number may eventually fall to two or three. In the near term, the big thrust of space investment will continue to involve sending sensors into the cosmos to measure what’s happening on Earth. So whether it’s detecting costly, environmentally damaging methane leaks from coal plants, assessing soil quality to maximise crop yields, or even just tracking the number of cattle in your fields or boats on the sea, creative uses for data gathered from space look set to flourish. But just how good space will be at enabling other business models — like tourism or organ-growing — remains to be seen. It could well be the case that a lot of these out-of-this-world ideas just won’t be worth the effort.

Rising stars

Reflex Aerospace

Satellite manufacturing & design

Total funding

€10.2m

Berlin, Germany
2021

Berlin- and Munich-based satellite maker aims to fulfil orders within nine months at a lower cost than competitors. Investors include Alpine Space Ventures and High-Tech Gründerfonds.

Round

Seed

Valuation

Undisclosed


Date

2023

Size

€1.8m

Archangel Lightworks

Imagery, AI & data analytics

Total funding

€4.8m

Oxford, United Kingdom
2017

This startup has created a mini ground station to receive information fired from space by laser. Archangel is working with the UK Space Agency and European Space Agency to begin testing its optical ground stations.

Round

Undisclosed

Valuation

Undisclosed


Date

2023

Size

Seed

Early stage startups to watch

AIKO

Turin, Italy
2017
Seed

1.6m

1.5m

-

AmbaSat

Northallerton, United Kingdom
2019
Bootstrapped

200k

50k

1.5m

Archangel Lightworks

Oxford, United Kingdom
2017
Seed

4.8m

4.8m

-

Earth Blox

Edinburgh, United Kingdom
2019
Seed

1.8m

1.8m

-

MURMURATION

Toulouse, France
2019
Grant

-

-

-

OrbAstro

Oxford, United Kingdom
2017
Bootstrapped

-

-

-

Orbit Boy

London, United Kingdom
2020
Pre-seed

2.7m

2.7m

-

Promin Aerospace

Kyiv, Ukraine
2021
Grant

450k

90k

-

Reflex Aerospace

Berlin, Germany
2021
Seed

10.3m

1.8m

-

Space Forge

Cardiff , Wales
2018
Seed

9.3m

8.8m

-

Spotlite

Coimbra, Portugal
2017
Support Program

1.5m

-

-

STRATOSYST s.r.o.

Prague, Czech Republic
2019
Grant

5.5m

500k

-

Studiomapp srl

Ravenna, Italy
2015
Grant

-

450k

-

Europe’s success stories

Who early stage startups are up against

(Pre-)Seed

SeriesA

SeriesB

SeriesC

SeriesD+

IPO/Exit

UK-based Reaction Engines is building rockets that it says can propel an aircraft from zero to 5x the speed of sound in the atmosphere and 25x the speed of sound for space access.

(Pre-)Seed

SeriesA

SeriesB

SeriesC

SeriesD+

IPO/Exit

UK defence company QinetiQ sold Space NV — its Belgium-based satellite division — to giant US space company Redwire in 2022.

(Pre-)Seed

SeriesA

SeriesB

SeriesC

SeriesD+

IPO/Exit

German satellite startup that takes temperature readings of Earth, which allows it to monitor vegetation, soil health and form insights on water and carbon levels. It raised $18.9m in seed funding earlier in 2023 in a round led by investor Karista. Other investors included Einstein Industries Ventures, FTTF, Lakestar, Vsquared, Amathaon Capital, Natural Ventures, OHB Venture Capital and EIT Food.

(Pre-)Seed

SeriesA

SeriesB

SeriesC

SeriesD+

IPO/Exit

Danish company founded in 2017 that supplies drone-based antenna testing and tracking solutions to the satellite, defence and broadcast industries. The Series A round was led by British early-stage investor IQ Capital in spring 2023.

(Pre-)Seed

SeriesA

SeriesB

SeriesC

SeriesD+

IPO/Exit

Finland’s ICEYE, a spinout from Aalto University, equips satellites with a technology called synthetic-aperture radar, which enables high-resolution image capture at night and in cloudy weather. In August 2023, ICEYE signed a deal to provide satellite imagery to NASA. Then in September, the company inked a deal with the Australian government to help enhance the country’s disaster response capabilities.

Sources

Data sources

Sifted Proprietary data

Dealroom.co Data

News articles

A beginner’s guide to investing in European spacetech December 2021 | Sifted

1 How private money changed the space industry October 2022 | The Universe. Space. Tech

2 Heart-stopping moment followed by jubilation as India's spacecraft lands on moon August 2023 | Sky UK

To the moon: 16 spacetech companies to watch, according to investors January 2023 | Sifted

SpaceX challenger raises €40m to build Europe’s first reusable rocket February 2023 | Sifted

Starting to take off: German rocket maker Isar Aerospace raises $165m March 2023 | Sifted

Japan’s ispace: the unruly start-up that shot for the Moon and missed September 2023 | The Financial Times

The new scramble for space requires a fresh set of rules September 2023 | The Financial Times

Making space for India September 2023 | The Financial Times

Reports

3 Revolution Space March 2023 | High-Level Advisory Group on Human and Robotic Space Exploration for Europe

Spacetech January 2023 | Sifted

European Space Tech lifting off December 2022 | Dealroom.co

Briefings

Spacetech October 2021 | Sifted

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